Bitcoin Recovery Runs Into Crucial Resistance, But 100 SMA Holds The Key
Bitcoin price started a decent recovery from the $10,139 swing low against the US Dollar. BTC gained pace above the $10,550 resistance, but it is facing a major hurdle near $10,800.
- Bitcoin managed to stay above the $10,000 support and started a decent recovery.
- The price is now trading above the $10,550 resistance and the 100 hourly simple moving average.
- There was a break above a major bearish trend line with resistance near $10,600 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The pair is currently facing a strong resistance near the $10,800 level (the previous support).
Bitcoin Price is Gaining Traction
After trading as low as $10,139, bitcoin price started a decent recovery against the US Dollar. BTC broke a few important hurdles near $10,400 and $10,550 to move into a short-term positive zone.
The recovery was such that the price settled above the $10,550 level and the 100 hourly simple moving average. There was also a break above a major bearish trend line with resistance near $10,600 on the hourly chart of the BTC/USD pair.
Bitcoin is now testing the next key resistance near the $10,800 level. A high is formed near $10,789 and the price is consolidating gains. An initial support on the downside is near the $10,640 level or the 23.6% Fib retracement level of the recent increase from the $10,139 low to $10,789 high.
Bitcoin price breaks $10,550. Source: TradingView.com
The next major support is near the $10,550 level and the 100 hourly simple moving average. The 50% Fib retracement level of the recent increase from the $10,139 low to $10,789 high is also near $10,464 to act as a support.
On the upside, the bulls are facing a huge task near the $10,800 level. If they manage to clear the $10,800 resistance, the price is likely to accelerate higher towards the $11,000 and $11,200 levels.
Is This Just a Recovery in BTC?
If bitcoin fails to continue higher above $10,780 and $10,800, it could start a fresh decline. The first major support is seen near the $10,550 level and the 100 hourly SMA.
A downside break below the 100 hourly SMA might put the bulls on the back foot. In the stated case, the price could trim gains and dive back towards the $10,200 support.
Technical indicators:
Hourly MACD – The MACD is now losing steam in the bullish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is correcting lower and it is above the 60 level.
Major Support Levels – $10,640, followed by $10,550.
Major Resistance Levels – $10,780, $10,800 and $11,000.
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Aayush Jindal, @KhareemSudlow